Skip to main content

Talks About Foreign Property Investors in Australia


There is no surprise that amid property price growth in Australia (especially in Sydney) some people would be interested in explaining the reasons of it. Beyond market conditions (demand higher than supply, low interest rates, higher income than many other places) there is also a tendency to blame foreign investors in influence on the property prices.
I have personally heard sentiments about this from persons who couldn't afford to buy property for themselves to live.

For some it is possibly easy to mark people who they see as competitors on the property market as foreigners. As an illustration you might consider this quote:

... I think it is hard to deny. If you imagine an auction on a weekend where you throw in an extra buyer who is willing to pay a little bit more than everyone else there, if that buyer happens to be foreign, maybe as a temporary resident, and they are buying the single place that they are able to get approval for, it is hard to deny that it would not push up the price.

Dr Christopher Kent, Assistant Governor, RBA, Committee Hansard, Sydney, 27 June 2014, p. 8.

At the same time how it is possible to identify the nationality of a person at an auction - by looks, by language, by behaviour? Unless we ask for their passports I presume.

Anyway foreign investors do exist. In regards to real estate, in 2012-2013 following 7 countries were the biggest investors in that sector (in $m):

China5,932
Canada4,926
USA4,406
Singapore2,008
UK1,671
Malaysia1,600
South Africa953

Foreign Investment Review Board Report 2012-2013

However in regards to them dominating the price push the facts tell it's exaggerated:

Foreign investment is not a significant driver of increased housing prices, playing a minor role in the overall housing market, and representing around 2.5 per cent of total annual sales.

Meriton Group, Submission 14, p. 2.

Very interesting.

Some links in regards to this matter:

Report on Foreign Investment in Residential Real Estate, 27 November 2014
Housing affordability: Are foreign investors to blame for Australia’s high property prices?
Foreign Investment in Residential Real Estate
One in six homes bought by foreigners
Where foreign investors are buying in Australia
13 facts about foreign property investors
Foreign buyers purchase up to 40pc of new Sydney, Melbourne homes
Labels:

Comments

Post a Comment

Popular posts from this blog

Scrum - Team Culture and Wall Manifesto

In the Scrum framework one of the key components is the wall and daily stand-up. In some organisations I worked with the whole concept of the wall is not accepted by many developers, because of the stand-up necessity and "time waste". Very often all that methodology is used for the sake of methodology and not to achieve what we actually do - adding or creating value to our customer (usually called "The Business"). I can understand frustration that is caused by the wall and stand-up process. From the software developer perspective it is really a waste of time for the following reasons: 1. In 95% of cases developers are head down working like hell delivering valuable outcomes that they are accountable for. Extra effort to go to the wall, staying there for 15-30 minutes and listening or not listening to what others were doing yesterday and will be doing tomorrow is annoying for them; 2. The mere fact of having to do something mandatory to do that looks like
Post a Comment
Read more

Construction issues resolution in Sydney - part 17

It's been a while since  the last post In January 2016 the owner lodged an application to NCAT against owners corporation to fix three major defects: - waterproofing of large windows in the living room and bedroom which led to windows full replacement - bathroom drain fix - planterbox fix The owners corporation didn't come to mediation and tribunal ordered to fix all defects within 2 months (the deadline was 8th July 2016). The owners corporation as usual didn't rush to comply with the order regarding two items: bathroom and planterbox. The windows works started end of April 2016. At the same time owners corporation decided to check whether it's a warranty and original builder should fix the issues. That was also related to the fact that the variation was submitted by the current contractor who started fixing the defect. So the owners corporation stopped all works in the middle and went off for a month to "make decision". The decision was mad
Post a Comment
Read more

Wine - 2011 Brown Brothers Crouchen Riesling

Very nice wine with fruity taste - peach and pear: Consumed with Hungarian salami. Tasting notes .
Post a Comment
Read more